Delhi High Court: While determining the maintainability of a petition filed under Section 29A (5) of the Arbitration and Conciliation Act, 1996, (Arbitration Act), seeking to extend the mandate of the Sole Arbitrator, a Single Judge Bench of Jasmeet Singh, J*, opined that the arbitrator’s discretion to fix venue/seat of arbitration must be construed strictly in the context of Section 20 of the Arbitration Act and it could not override parties’ exclusive jurisdiction clause in arbitration agreement. Thus, the Court dismissed the present petition on the grounds of lack of territorial jurisdiction.
Background
Viva Infraventure (the petitioner) was awarded a tender by the New Okhla Industrial Development Authority (the respondent) for construction of a road in Greater Noida. Subsequently, a dispute arose, and a Sole Arbitrator was appointed in accordance with the dispute resolution clause contained in the general conditions of the contract. The Sole Arbitrator had designated Delhi as the seat of arbitration.
The Sole Arbitrator, through the first procedural order, had stipulated that the seat of the arbitration would be New Delhi while the contract between the parties provided that the Courts at Gautam Budh Nagar would have exclusive jurisdictions for all matters relating to enforcement of arbitration agreement.
The instant petition had been filed for an extension of the mandate of the Sole Arbitrator. The respondent had raised issues of maintainability stating that the Court did not have the territorial jurisdiction to decide the present case. The issue before the Court was whether the Sole Arbitrator could override the choice of seat expressed in the arbitration agreement.
Analysis, Law and Decision
The Court referred to Section 20 of the Arbitration Act by which parties are free to agree on any place as the place/venue of arbitration which would determine the juridical seat and the Court that would exercise supervisory jurisdiction. In the event that parties are unable to come to an agreement, the Arbitral Tribunal, under Section 20(1)(e) of the Arbitration Act, may determine the venue.
However, in the instant case, the exclusive jurisdiction clause of the arbitration agreement clearly stated that the venue may be decided by the arbitrator and that any application for enforcement of the arbitration agreement must be filed with the Courts at Gautam Budh Nagar. The Court therefore held that where the arbitration clause had designated a particular ‘venue’, such designation must be construed as ‘seat’ of arbitration unless any intention to the contrary is evident.
The Court further held that when an exclusive jurisdiction clause identifies a specific court to have supervisory jurisdiction over the seat of the arbitration, party autonomy must be respected, and the sole court must have supervisory jurisdiction.
Thus, the Court held that the arbitrator’s discretion to fix venue/seat under the exclusive jurisdiction clause must be construed strictly in the context of Section 20 of the Arbitration Act and could not override the parties’ explicit agreement. Thus, the Court dismissed the present petition on the grounds of lack of territorial jurisdiction.
[Viva Infraventure Pvt. Ltd. v. New Okhla Industrial Development Authority, 2025 SCC OnLine Del 4684, decided on 1-7-2025]
*Judgement authored by- Justice Jasmeet Singh
Advocates who appeared in this case:
For the Petitioner: Suhail Dutt (Senior Advocate), Vikas Tiwari, Kumar Deepraj, Arushi Rathore, Advocates
For the Respondent: Suvigya Awasthy, Vivek Joshi, Rohan Gulati, Advocates.
Buy Arbitration and Conciliation Act, 1996 HERE
